12AA registration cannot be made conditional on prior State endowments registration when the Income-tax Act imposes no such requirement.

Registration under section 12AA of the Income-tax Act cannot be made conditional on prior registration under section 43 of the Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1987, because the Income-tax Act does not prescribe such a prerequisite. A condition imposed by the tax authority linking the two registrations was therefore unrelated to the purpose of section 12AA and unsupported by the statute. The coordinate Bench view in an earlier matter was followed, and registration under section 12AA was to be granted without insisting on the State Act registration.

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Issues: Whether registration under section 12AA of the Income-tax Act, 1961 could be made subject to a condition requiring registration under section 43 of the Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1987.

Analysis: The statutory scheme of sections 12A and 12AA of the Income-tax Act, 1961 does not prescribe any requirement that a trust or institution must first obtain registration under section 43 of the Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1987. The condition imposed by the Director of Income-tax (Exemptions) was therefore unrelated to the purpose of registration under section 12AA and was not supported by the Act. The coordinate Bench view in an earlier matter was also followed.

Conclusion: The condition was held to be unwarranted and the assessee was entitled to registration under section 12AA without insisting on registration under section 43 of the Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1987.

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